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Standard & Poor's Affirms Kenya Rating On Infrastructure Progress

LONDON -(Dow Jones)- Rating agency Standard & Poor's Corp. affirmed Kenya's sovereign credit rating Tuesday citing progress in tackling infrastructure constraints, as well as continued macroeconomic prudence.

"Nevertheless, the ratings remain constrained by the political risks highlighted by the 2008 post-election crisis which, if inconclusively addressed in the coming months, could result in a revision of the outlook back to stable," said S&P credit analyst Remy Salters in a statement.

At least 1,500 people died in violence that broke out in Kenya following the disputed December 2007 elections.

Battered by the political crisis and the global economic downturn, Kenya's economy grew by 1.7% last year. S&P said it expects growth to remain below trend at 2.5%-3.0% in 2009-2010.

"Adverse global conditions are partly offset by still resilient growth among some of Kenya's regional trade partners, but there is further downside risk related to external shocks," the rating agency said.

Kenya is rated B by Standard & Poor's. The outlook is positive reflecting the rating agency's expectation that Kenya's coalition "will work together to finally deliver in the coming year on the thornier issues arising from the post- electoral crisis."

This, along with the country's ongoing economic policy prudence, could pave the way for a rating upgrade, S&P said.

-By Clare Connaghan, Dow Jones Newswires; +44 (0) 20 7842 9496; clare.connaghan@dowjones.com

  (END) Dow Jones Newswires
  11-10-091007ET
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